Historical Turning Points in Spanish Economic Growth and Development 1808 2008 1St Ed Edition Concha Betran Full Chapter
Historical Turning Points in Spanish Economic Growth and Development 1808 2008 1St Ed Edition Concha Betran Full Chapter
Historical Turning Points in Spanish Economic Growth and Development 1808 2008 1St Ed Edition Concha Betran Full Chapter
Edited by
Concha Betrán · Maria A. Pons
Palgrave Studies in Economic History
Series Editor
Kent Deng
London School of Economics
London, UK
Palgrave Studies in Economic History is designed to illuminate and
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past. The series covers a vast range of topics including financial history,
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tion, industrialisation, modernisation, globalisation, and changes in
world economic orders.
Historical Turning
Points in Spanish
Economic Growth
and Development,
1808–2008
Editors
Concha Betrán María A. Pons
University of Valencia University of Valencia
Valencia, Spain Valencia, Spain
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Acknowledgements
v
Contents
1 Introduction 1
Concha Betrán and María A. Pons
vii
viii Contents
8 Epilogue231
Concha Betrán and María A. Pons
Index255
Notes on Contributors
ix
x Notes on Contributors
Fig. 1.1 Real GDP per capita in 2011 US$ in logs. (Source: Bolt et al.
(2018))11
Fig. 2.1 Public budget deficit on GDP (%). (Source: Comín (2014a)) 30
Fig. 2.2 Ten-year Government Bond Yield (%). (Source: Comín (2016)) 31
Fig. 2.3 Protection and Openness rate (%). (Source: Tena (2005)) 39
Fig. 2.4 Number of banks of issue and credit societies. (Source: Cuevas
(2018))41
Fig. 3.1 Foreign trade: exports and the trade balance, 1880–1913.
(Source: Estadísticas del Comercio Exterior de España)63
Fig. 3.2 Prices and the peseta exchange rate. (Source: Martín-Aceña
and Pons (2005)) 72
Fig. 4.1 Spain’s real GDP per capita compared with the US, the UK,
France and Germany, 1929–1935. 1929=100. (Note: Own
calculations from Maddison Project Database (2018), real
GDP per capita in 2011 US$ (rgdpnapc), 1929=100. Source:
Maddison Project Database, version 2018, in Bolt et al. (2018)) 95
Fig. 4.2 Trend in Spain’s industrial, agricultural, construction and
services GDPs, 1929–1935. (Note: GDP for Agriculture,
Industry, Construction and Services, volume indices of gross
value added, 1929=100. Source: Prados de la Escosura (2017)) 96
Fig. 4.3 Exchange rates in relation to the dollar, pound sterling and
franc. (Note: The peseta value of each currency, 1920=1.
Source: Martín-Aceña and Pons (2005)) 97
xi
xii List of Figures
Fig. 4.4 Imports, exports and agrarian exports and trade balance.
(Notes: All values in millions of 1913 pesetas. Trade is special
trade. Source: Tena (2005) and Barciela et al. (2005)) 100
Fig. 4.5 Spain’s central bank discount interest rates compared with the
US, the UK and France. (Source: For the UK and France,
Forero-Laverde (2018); for Spain, Comín and Martín-Aceña
(1984); for the US, the Federal Reserve Bank of St. Louis,
Economic Data) 102
Fig. 4.6 Spain’s public budget-to-GDP ratio (%) compared with the
US, the UK and France. (Source: Jordà, Schularick and Taylor
(2017), datasetR4 (Release 4, May 2019)) 103
Fig. 5.1 Current account imbalances on GDP (%), 1950–1964.
(Source: Spain, Tena (2005); other countries, Jordà,
Schularick and Taylor (2017) 130
Fig. 5.2 Consumer Price 1952–1957 (Average annual change, %).
(Source: Spain, INE; other countries, World Survey data
United Nations (1957)) 131
Fig. 5.3 CPI index 1959–1965. (Source: Spain, Maluquer (2013);
other countries, Jordà, Schularick and Taylor (2017)) 147
Fig. 6.1 CPI annual rates of growth, 1970/1979 and 1980/1984.
(Source: Spain, Maluquer (2013); other countries, Jordà,
Schularick and Taylor (2017)) 166
Fig. 6.2 Government expenditure/GDP in Europe, 1970–1990 (%).
(Source: Alcaide (1988), Bank of Spain and Eurostat) 176
Fig. 7.1 GDP growth rate (2000 constant market prices). (Source:
Boldrin et al. (2010)) 199
Fig. 7.2 Net international investment position and current account
balance as percentage of GDP. (Source: Banco de España) 206
Fig. 7.3 State expenditures and revenues as a percentage of
GDP. (Source: Eurostat) 210
Fig. 7.4 GDP growth and evolution of unemployment. (Source: Banco
de España) 219
List of Tables
Table 3.1 Share of the colonial market in total Spanish exports. (In
percentages)60
Table 3.2 The cost of the colonial wars. (In thousands of pesos (pesetas
in parentheses)) 70
Table 3.3 Debt issues in Spain and in the colonies to finance the wars 71
Table 3.4 Central government budget, 1900–1913. (Million pesetas) 75
Table 3.5 Public debt in circulation. (Million pesetas) 76
Table 5.1 Financial aid as a percentage of GDP 140
Table 5.2 Foreign sector, 1959–1973 142
Table 5.3 Educational indicators, 1960–1970 151
Table 6.1 Unemployment rates in Spain and other countries, 1969–1985 167
Table 6.2 Functional distribution of public expenditure, cumulative
annual growth rate 177
Table 8.1 Growth and development in Spain, 1800–2015 251
xiii
1
Introduction
Concha Betrán and María A. Pons
Turning points in history alter the basic rules, institutions and attitudes
upon which a country’s past has been founded. Wars, revolutions, radical
political regime changes, lasting economic crises and even natural disas-
ters provoke ruptures and mark new departure points for the future of a
country as a whole. When a turning point occurs, the previous circum-
stances do not vanish, they simply melt down into the new in a path-
dependence dynamic, conditioning how countries face the next
challenges.
In modern times, there have been some important watersheds, such as
the French Revolution, the American War of Independence, the First
World War, the Russian Revolution, the Great Depression, the Second
World War, the Chinese Civil War or the financial crises that began in
2007–2008. For example, the French Revolution ended the feudal soci-
ety of the Ancien Régime and brought about radical political, social and
economic changes that marked the beginning of a new era. The Great
Depression can also be considered a turning point: a severe, protracted
economic crisis, which led to the fragmentation of the world economy,
the emergence of totalitarian political regimes, the sinking of democracy
in many nations, the rise of the State as a major economic agent and the
implementation of new economic policies. Lastly, the recent financial
crisis that began in 2007–2008 was the first economic crisis of the twenty-
first century; this so-called Great Recession has entailed profound changes
and challenges. All these events represent a sharp break with the past and
launching pads into the future.
The aim of this book is to study the main turning points in the Spanish
economy and the related challenges it faced; in so doing, we examine the
country’s long-run economic development over more than 200 years. We
concentrate on six turning points that changed the direction of the
Spanish economy, although most of them also took place in the world
economy. For this reason, the book also compares the Spanish trajectory
with the international one. We explore the macroeconomic context in
which these turning points happened, as well as the external and internal
constraints on domestic political choices for a small country like Spain in
the different periods. This is an interesting and innovative perspective
since most of the turning points in economic history (the fall of an Ancien
Régime or the Great Depression, for instance), as well as their long-term
positive and negative consequences, are generally studied from the view-
point of core countries such as the UK, the US or Germany.
Firstly, we explain why the chosen events marked a turning point in
the Spanish economy. We also identify the economic, social or political
origin of these watersheds and determine whether they were triggered by
a domestic or an external shock. Secondly, we focus on how Spain faced
up to each turning point, the reforms that were implemented, the differ-
ences between the Spanish response and that of other countries, the
results of the policies enacted and what problems were not tackled. We
explore what ultimately changed, and what did not, considering both
international differences and the problems that Spain had in common
with other countries, as well as differences and similarities in terms of
their policies and resolutions. We consider the changes in different aspects
such as growth and structural change, the international sector and trade
1 Introduction 3
related to the international context; (2) how Spain faced up to the situa-
tion, the policies adopted in response to the shock, the reforms that were
implemented and what challenges were not tackled, the differences
between the Spanish response and that of other countries, and the restric-
tions or limitations that determined the adoption of specific measures;
(3) the results of the policies enacted, whether the end result represented
a step forward in terms of the country’s development and modernization
or whether it produced an economic setback.
The turning points chosen for analysis in this book are the following:
Chapter 2 is written by Francisco Comín and deals with the events of
1808 and the turning point they represented. The first turning point in
modern Spain’s economic history was the Napoleonic invasion of the
country, followed by the so-called War of Independence and the loss of
its colonial empire on the American continent. The invasion sparked an
economic disaster and divided the country in two. It was a complex con-
flict in which the war against the French troops was intertwined with
revolutionary movements that challenged the essence of the Ancien
Régime. The common people rallied together to drive the invaders out of
the Iberian Peninsula, while the political and social elites split apart. The
war, however, brought about significant changes: there was an accelera-
tion in the enlightenment reforms, which had begun in the last decades
of the eighteenth century, aimed at modernizing the fabric of the coun-
try; the first liberal constitution was enacted by the Cortes meeting in the
city of Cádiz; and the remains of the feudal regime were abolished.
However, as the implemented reforms were the result of a pact between
liberals and the aristocracy, the institutions were less inclusive than in
other countries and this had long-term political and economic conse-
quences. The loss of the American colonies, which had been in possession
of the Spanish Crown for more than three centuries, was a severe blow to
the economy. Trade flows and Treasury finances were both significantly
affected. Moreover, the people’s perception of their own country changed:
Spain fell from being an imperial nation to a second-rate European
power. Finally, the challenges Spain faced centred on how to change insti-
tutions to shape a more progressive society and move away from the old
institutions which had benefitted the elites of the Ancien Régime.
1 Introduction 5
Russia, gained new colonies, Spain was forced to abandon three rich and
strategic territories. Is there an economic explanation for this outcome? Is
there any evidence that the 1898 colonial “disaster” was due to economic
weakness? What was the economic importance of the lost colonies of
Cuba, Puerto Rico and the Philippines? We contemplate the impact of
Spain’s loss of the colonial market, its control over strategic resources and
the financial linkages. Finally, the 1898 Spanish watershed will be con-
nected with turning points in or around that date in other peripheral
European countries.
Chapter 4 addresses the 1936 turning point, which has been analysed
by Concha Betrán. Taken together, the Great Depression and the Civil
War mark another turning point in Spanish political and economic con-
ditions, accompanied by the collapse of the monarchical regime for the
second time and the establishment of a modern democracy with the
Second Republic in April 1931. Although the Depression was less severe
in Spain than in the US or in some European countries (France and
Germany for instance), economic growth stopped, unemployment rose
and social conflicts intensified. The new Republican regime attempted to
implement reforms to meet the challenges: creating new institutions to
promote growth and establishing “inclusive” institutions and economic
policies to face the international crisis. Their objectives were compelling
and sometimes contradictory. Since the country was divided into back-
wardness and modernity, the reforms were not well accepted by the part
of the country that stood to lose out as a result (especially landowners but
also rent-seekers). At the same time, these reforms did not go far enough
for the other part that expected substantial change (mainly labourers).
Meanwhile, the still small new middle class, living in growing cities, was
in favour of modernization. All this occurred in an international context
in which existing economic policies were being called into question and
the new regime had to balance the importance of gaining domestic and
international respectability (using orthodox fiscal and monetary policy)
with their efforts to shift towards a moderate protectionist policy, and
enact land, labour and educational reforms. Although there had been an
economic recovery, political and social confrontation was fierce from
1934 to 1936 and ended in a civil war. Similar situations arose in the
international context, where different ideologies, including totalitarian
1 Introduction 7
economy, first with support in the form of foreign aid, and subsequently
through the absorption of labour (emigration), tourism and direct invest-
ment. Despite its limitations, the Stabilization Plan allowed Spain to
benefit from the so-called “advantage of backwardness”. First, the Plan
enabled the introduction of new technologies through the imports of
capital goods, direct investments and the acquisitions of patents and reg-
istered trademarks, which in turn facilitated a boost in productivity in the
industrial and agricultural sectors. Secondly, the Plan exposed Spanish
firms to international competition in a favourable international context.
Western Europe was a huge market for Spanish goods, and trade open-
ness broadened the narrow internal market. Thirdly, international capital
openness increased the availability of external sources of financing used
to promote economic growth. Finally, the Plan contributed to the imple-
mentation of complementary reforms that facilitated monetary control
and helped reduce some macroeconomic imbalances (e.g., by stopping
the issue of government debt automatically pledged with the Bank of
Spain, or increasing taxes to reduce public deficits). The 1959 Stabilization
Plan is a good example of the benefits for an economy of changing from
autarky and interventionism to trade liberalization and market regula-
tion. But it is also an example of how political restrictions (the dictator-
ship) restricted the scope of the reforms and the country’s long-term
development potential.
Chapter 6 deals with the 1977 turning point, and is written by Joaquim
Cuevas and Maria A. Pons. A fourth watershed moment that can be high-
lighted is the economic and financial crisis of the 1970s due to the oil
shocks. It is considered one of the “Big Five” twentieth-century crises and
coincided with Spain’s political transition from a dictatorship to a full-
fledged democratic regime. As in other parts of the world, these were
crucial years: the Spanish golden age came to an end; growth slowed
down and then stopped; dire difficulties emerged in the banking system;
solvency and liquidity problems affected half of the credit institutions
and eventually led to their collapse. Uncertainty about the immediate
future paralyzed policy makers. Output fell, prices skyrocketed and
unemployment reached historical levels. Although the crisis was sparked
by an external shock (the oil shock), there are several particular features
1 Introduction 9
of the Spanish case that make 1977 a turning point in Spanish economic
history. Firstly, the economic crisis was accompanied by political and
institutional change. The political transition and the weakness of the new
governments shaped responses to the crisis, with key economic decision-
making postponed. Secondly, the crisis was more severe in Spain than in
other countries. The magnitude of the macroeconomic imbalances accu-
mulated during the Franco period and the delay in the implementation
of economic measures contributed to this severity. The main reforms,
which were implemented after the 1977 political agreement known as
the Pactos de la Moncloa, sought to address several key challenges: (a) to
reduce the main macroeconomic imbalances (inflation, public deficit);
(b) to increase the capacity of the State to implement economic policy
(fiscal and monetary policies) and to provide public goods such as health,
education or social and physical infrastructure; and (c) to engage in com-
plementary structural reforms such as industrial restructuring, labour
market reforms and decentralization of the State. The government priori-
tized stabilizing macroeconomic measures, meaning the implementation
of the structural reforms had to wait until the 1980s. The result was larger
imbalances and structural problems; in particular, unemployment rates
that were far higher and more persistent than in other European coun-
tries. Political instability and resistance from special-interest groups hin-
dered the adoption of other longer-term structural reforms. As a result,
some of these reforms were undertaken only in 1982 when the Socialist
party (PSOE) came to power and there was a broader consensus.
Moreover, some reforms were a prerequisite for entry into the European
Community in 1986. Ultimately, we have to consider not only the limits
of the reforms but also their seminal nature: the reforms implemented
from 1977 onwards marked the beginning of the path to modernization,
liberalization and international integration on a level with other European
countries, a process that was consolidated up to the beginning of the
twenty-first century.
Chapter 7 is about the 2008 turning point, and is authored by Jose
Ignacio Conde-Ruiz and Elena Martínez-Ruiz. The most recent eco-
nomic and financial crisis marks another turning point in Spanish eco-
nomic history. Prior to the crisis, Spain had been one of the economies
10 C. Betrán and M. A. Pons
that had benefitted most from European Economic and Monetary Union
(EMU) membership. During the first seven years after the inauguration
of the monetary union, Spain’s economy enjoyed a phase of sustained
growth with notable progress made in terms of real convergence with the
core EU member countries. However, the economic growth in the
1999–2007 period was based on foundations that could not be main-
tained indefinitely. The demand stimulus provided by EMU membership
was only partially accommodated by the expansion in domestic output,
based on an exceptional increase in the rate of employment. This was not
adequately matched by an improvement in productivity. A series of
imbalances thus began to emerge which undermined the dynamism of
the expansion: inflation differentials, an increasing current account defi-
cit due to a pronounced loss of external competitiveness and rising levels
of household and corporate debt. The disequilibria came to light when
the international economic atmosphere changed in 2007 with the finan-
cial crisis in the US. The crisis did not take long to affect the Spanish
economy, although the authorities were slow to recognize it. The Spanish
Great Recession has been long and severe, and to some extent has changed
the fabric of the country. There are several reasons why the 2008 Great
Recession has been a turning point for Spain. Firstly, it has been the most
profound of all the Spanish economic crises in the analysed period. The
crisis produced a severe recession and a consequent decline in GDP
growth, very high unemployment rates, high levels of public debt that
reached sovereign debt crisis proportions and damage to Spain’s reputa-
tion and credibility as it sought assistance from abroad in order to deal
with its economic difficulties. Secondly, most of the resulting reforms
were targeted at solving the banking crisis, with vulnerable banks being
rescued by the government. The counterpart was the implementation of
austerity measures with major budget cuts in sectors such as education
and health. Thirdly, the economic crisis was also accompanied by a politi-
cal and institutional crisis. The economic deterioration undermined the
public trust in Spanish politicians as well as in other major Spanish insti-
tutions such as the Bank of Spain, the judiciary system and the monar-
chy. Finally, the crisis accentuated territorial tensions (Catalan calls for
independence) and social tensions (the 15 M or indignados movement).
1 Introduction 11
This chapter provides an analysis of the related policy decisions and the
adoption of measures aimed at overcoming the crisis. It also explores
essential aspects such as the consequences of making the solution to the
banking crisis the top priority, how other European countries faced the
crisis and how eurozone membership conditioned these responses.
The book includes an Epilogue written by Concha Betrán and Maria
A. Pons, which presents the main conclusions regarding Spain’s ability to
respond to the key challenges it has faced from 1808 to 2008.
In Spain, real GDP per capita multiplied by more than 20 times
between 1808 and 2008. To put this in perspective, if we compare
Spanish real GDP per capita with that of other large Western countries
(France, Germany, Italy, the UK and the US), we can see that Spain’s level
of GDP per capita has been consistently lower1 (Fig. 1.1). Spain had a
lower level of GDP per capita in 1808 than other Western countries,
showing that the economic differences started before the beginning of the
100000
10000
1000
1820
1824
1828
1832
1836
1840
1844
1848
1852
1856
1860
1864
1868
1872
1876
1880
1884
1888
1892
1896
1900
1904
1908
1912
1916
1920
1924
1928
1932
1936
1940
1944
1948
1952
1956
1960
1964
1968
1972
1976
1980
1984
1988
1992
1996
2000
2004
2008
2012
Fig. 1.1 Real GDP per capita in 2011 US$ in logs. (Source: Bolt et al. (2018))
12 C. Betrán and M. A. Pons
nineteenth century. Around 1800, Spain’s real GDP per capita was a long
way off that of the leading country (the UK), representing only 48.8 per
cent of the real GDP per capita in the UK, and 57.6 per cent of that in
Italy. However, it was equivalent to around 80 per cent of German and
US real GDP per capita and above 87 per cent of that in France. In 2008,
Spain was relatively better positioned in terms of real GDP per capita
than in 1800, at 67 per cent of the real GDP per capita in the US (the
leading country), nearly 80 per cent of that in Germany and around
91–93 per cent the real GDP in France, the UK and Italy.
As Prados (2017) explains, the improvements in Spain’s position in
terms of real GDP per capita did not follow a monotonic trend; rather,
there were periods of divergence and other periods of catching up. The
aim of the book is to analyse the years that marked a watershed in Spanish
economic history and examine how they transformed the economy and
changed its position relative to other countries.
It can thus be seen that in this period (1808–2008), Spain has evolved
into a developed economy and there have been phases of progress and
catching up. Despite this, Spain shows some important weaknesses that
have their roots in the past. The book studies how Spanish economic
problems are related to the (domestic and international) economic condi-
tions and examines the responses to the challenges adopted at key
moments; moreover, it tries to understand the reasons for these specific
responses.
Among the factors that have conditioned the main responses and their
implementation, the book concentrates on: the economic structure
(Spain as a late industrializer), the interaction between the political and
economic processes (the late establishment of a democratic regime), the
distribution of power and wealth among different interest groups, and
their influence on the institutional framework and income distribution
(which determined whether or not the country could afford to imple-
ment the necessary reforms). We also consider the international context
(which in some specific cases limited the country’s capacity of reaction
but in other cases stimulated growth and development).
1 Introduction 13
Note
1. We have used data on real GDP per capita from Bolt et al. (2018).
References
Bolt, J., R. Inklaar, H. de Jong, and J.L. van Zanden. 2018. Rebasing “Maddison”:
New Income Comparisons and the Shape of Long-Run Economic
Development, Maddison Project Working Paper 10.
Prados de la Escosura, L. 2017. Spanish Economic Growth 1850–2015. London:
Palgrave Macmillan.
2
1808: The Napoleonic Wars and the Loss
of the American Colonies
Francisco Comín
F. Comín (*)
University of Alcalá, Madrid, Spain
on 2nd May 1808 with the popular uprising against Napoleon because
he had forced the royal family to abdicate in favour of the Bonaparte
dynasty. It ended in 1814, when Napoleon restored Ferdinand VII to the
throne and the French occupation came to a close. In order to move his
armies to Northern Europe, Napoleon signed a secret agreement with
Ferdinand VII that restored him to the throne of Spain, overturning the
constitutional regime. The European powers, including Great Britain,
contributed to the fall of the constitutional regime, considering it too
revolutionary.
The liberal revolution lasted longer because Ferdinand VII restored the
Ancien Régime which prolonged the conflict between liberals and abso-
lutists until 1840, giving rise to coups d’état and civil wars. This state of
affairs can be explained by the fact that neither side was militarily capable
of prevailing over its enemy. The liberals lacked the strength to impose
themselves on the nobility and the Church, who defended the absolutism
of Ferdinand VII, and he needed the help of foreign forces to overthrow
the liberal governments in 1814 and 1823, when he restored absolutism.
But the situation changed after the death of Ferdinand VII in 1833, as
the nobility that backed the royal claim of his daughter Isabella was sup-
ported by the moderate, Francophile and progressive liberals, who took
seven years, until 1840, to defeat the Carlists, despite outside assistance
from Great Britain and the Holy Alliance. The agreement between the
liberals and the nobility allowed Isabella II to win the dynastic war and to
carry out the bourgeois revolution enacted by the liberal regime in Spain.
But this agreement moderated the reforms of the liberal revolution, creat-
ing less inclusive economic institutions than in the rest of Europe, which
hindered industrialization.
Another feature specific to Spain was that Napoleon’s invasion trig-
gered the wars of independence by the American colonial viceroyalties,
which created the Latin American independent republics from 1821. The
Napoleonic Wars put an end to the Spanish Empire, benefitting the
industrialized nations that were able to trade with the former Spanish
colonies.
The most relevant consequence of the Napoleonic Wars, therefore, was
that it unleashed the liberal revolution in Spain on two fronts, since two
liberal revolutions took place simultaneously. In the first, Napoleon
18 F. Comín
appointed his brother as king (Joseph I) and, with the support of the
Francophiles, established French institutions in the occupied Spanish ter-
ritories, beginning with the Bayonne Constitution. In the second, the
patriot government opened Constituent Cortes in Cádiz, which approved
the Constitution of Cádiz in 1812. The restoration of absolutism in 1814
prolonged the cycle of wars and coups d’état, revolutions and counter-
revolutions until 1868, when a military coup brought an end to the First
Spanish Republic (1873), restoring the Bourbon monarchy (1874). This
political instability delayed the success of liberal reforms until the
Democratic Sexennial (1868–1874).
The Napoleonic Wars had various different consequences in Spain. In
the first place, the plunder and destruction of the war had short-term
repercussions on population, agriculture, industry, finance and trade,
although the Spanish economy soon recovered from these immediate
effects. On the other hand, more lasting effects of the war came from the
issuance of large amounts of public debt to finance it, as well as the loss
of the continental American colonies; these two events led to the bank-
ruptcy of the public Treasury and shaped the economic policy decisions
of the Spanish governments well into the latter half of the nineteenth
century. Lastly, the longest-term effects of Napoleon’s invasion were the
institutional reforms introduced by the liberal revolution, initiated by the
government of Joseph Bonaparte (Bayonne Constitution) and by the
patriot governments (Constitution of Cádiz): the War of Independence
sparked the liberal revolution and the formation of the liberal State,
which established the institutions of capitalism, which in turn were con-
ducive to industrialization in Spain (Llopis 2002; Pro 2019).
This chapter evaluates the impact of the Napoleonic Wars, the institu-
tional reforms and their effects on growth, economic structure and wealth
distribution in Spain. Particular attention is paid to the persistence of
Old Regime political and economic institutions and behaviours that dis-
torted the practical application of the new laws, which were formally
similar to those of other European nations. Section 2.2 examines the
short-term effects of the Napoleonic invasion: death, destruction, sei-
zures, and agricultural and industrial crises. Section 2.3 studies the insti-
tutional impact of the Napoleonic Wars and the absolutist and
constitutional regimes that followed between 1808 and 1874, focusing
2 1808: The Napoleonic Wars and the Loss of the American… 19
against Napoleon were caused by factors related to the war. On the one
hand, the battles and the siege of cities during the war resulted in a loss
of human lives in both the Spanish army and the civilian population; on
the other hand, the war itself and the displacement of the troops had a
greater indirect impact on mortality by setting in motion the traditional
mechanisms that caused shortages, famines and epidemics. The most
serious demographic crises occurred in 1809, 1812 and 1813–1814. The
“Napoleonic cycle of the Spanish population” covers the first 15 years of
the nineteenth century and was characterized by an estimated negative
balance in potential population growth (due to increased mortality and
falling birth rates) of 800,000 people. In the six years of the War of
Independence, the magnitude of this loss of potential population was
similar to that produced by the Civil War (560,000 deaths between 1936
and 1942) (Pérez Moreda 2010: 327–329).
The second consequence concerns the major change in the agrarian
structure generated by the War of Independence, namely, the halving of
the transhumant sheep population. Official exports of merino sheep to
France did not exceed 200,000 head (less than 5% of the four million
head of sheep in the transhumant population). The main causes of the
drop in the transhumant sheep population were theft, requisitioning by
troops, the illegal extraction of herds sold by their owners and the confis-
cation of this property. The church-owned flocks were disentailed and
their flocks of sheep were purchased by many buyers who kept the merino
sheep as local grazing. A key factor in the decline of transhumant sheep
herding was the loss of international markets for the lowest-quality
Spanish merino wool and competition from the wool produced by
merino sheep exported and acclimatized to Northern Europe. After the
war, most of the Spanish merino wool went to the Catalan wool industry.
The abolition of the Mesta in 1836 was a liberal measure that was not
difficult to enact as the transhumant sheep farming was no longer profit-
able (García Sanz 2010: 390–396).
Thirdly, the legal and ideological ruptures as well as the changes in the
practices of political and economic agents (nobles, merchants, urban oli-
garchies, peasants) caused by the Napoleonic Wars led to vast areas of
land being put under the plough and the non-payment of feudal rents,
tithes and other taxes by peasants. On the one hand, the creditors of the
2 1808: The Napoleonic Wars and the Loss of the American… 23
due to the existence of the institutions of the Ancien Régime, the Catalan
bourgeoisie became revolutionary, seeking to abolish those institutions
and establish liberal economic ones. Besides, the emancipation of the
colonies brought an end to the remittances from America, which had
represented a source of income for the State and profits for the mer-
chants. From then on, the Spanish Treasury was financed through main-
land Spanish resources, with the exception of the transfers from Cuba
(Moreno 2015, 2018). Finally, the loss of the empire transformed foreign
trade, as exports to America fell by 60%, transit trade between the colo-
nies and Europe disappeared and the flow of silver from America used to
compensate Spain’s trade deficit with the other European countries dried
up. This deficit led to an increase in the outflow of silver, generating a
deflationary process aggravated by Napoleon’s monetary war, in which
the government of Joseph Bonaparte mandated the use of the French cur-
rency as a means of payment, attributing a nominal value equal to the
Spanish currency although the latter was worth 10% more on the mar-
ket. In accordance with Gresham’s Law, Spanish coins disappeared from
Spain, with the French coins being used until the monetary reform
implemented by Figuerola in 1869 (Prados de la Escosura and Santiago-
Caballero 2018).
1868. The main taxes of the liberal tax system of 1845 were the land
tax, the excises and the customs tariff. Despite their opposition to State-
owned companies, the liberals retained some fiscal monopolies (tobacco,
salt, the lottery) and some State mines (Almadén, Río Tinto) to supple-
ment public revenues (Fontana 1973, 1977; Comín 1988). However, the
tax system allowed landlords and industrialists to commit tax fraud, as
they hid their wealth to the Treasury, shifting the tax burden to peasants
and urban consumers. Tax fraud was another one of the causes underly-
ing the insufficient tax revenues and the public deficit shown in Fig. 2.1.
The poverty of the Treasury prevented the State from fulfilling the clas-
sic public functions: defence, security, public works and education. This
fiscal incapacity explains the powerlessness of the Spanish army and the
foreign invasions. It can also explain the reduced public investment in
social fixed capital stock and human capital, which slowed down the
industrialization process. So few public resources were devoted to educa-
tion that most of the population remained illiterate (70% of the
-1
-2
-3
-4
-5
-6
-7
Fig. 2.1 Public budget deficit on GDP (%). (Source: Comín (2014a))
2 1808: The Napoleonic Wars and the Loss of the American… 31
45
40
35
30
25
20
15
10
0
1788
1790
1792
1794
1796
1798
1800
1802
1804
1806
1808
1810
1812
1814
1816
1818
1820
1822
1824
1826
1828
1830
1832
1834
1836
1838
1840
1842
1844
1846
1848
1850
1852
1854
1856
1858
1860
1862
1864
1866
1868
1870
1872
1874
1876
1878
1880
1882
1884
1886
1888
1890
Spain UK
Fig. 2.2 Ten-year Government Bond Yield (%). (Source: Comín (2016))
32 F. Comín
Oh ! le caribou-ou-ou, le caribou-ou-ou
Il rôtit en l’air,
Haut sous le ciel clair,
Le gros et blanc caribou-ou-ou !
— A vous, maintenant ! hurla-t-il. A vous, et en chœur !
Et, se réveillant du long silence qui, si longtemps, avait pesé sur
eux dans le Wild, hommes, femmes et enfants entonnèrent le chant
à leur tour, avec une frénésie sauvage, qui éclata vers le ciel. En
même temps, se prenant par les mains, ils mettaient en branle,
autour des quatre broches enveloppées de flammes, la Grande
Ronde.
A plusieurs milles au sud et au nord, à l’est et à l’ouest, se
répercuta ce tonnerre formidable. Kazan et Louve Grise, et les
outlaws sans maîtres qui étaient avec eux, l’entendirent. Et bientôt
se mêlèrent aux voix humaines le hurlement lointain des chiens,
qu’excitait la sarabande infernale.
Les compagnons de Louve Grise et de Kazan ne tenaient pas en
place. Ils dressaient leurs oreilles dans la direction de l’immense
rumeur et gémissaient plaintivement.
Kazan n’était pas moins troublé. Il commença son manège
ordinaire avec Louve Grise, qui s’était reculée en montrant les dents,
et qu’il tentait d’entraîner à sa suite. Toujours, d’ailleurs, aussi
vainement.
Alors il revint vers les quatre huskies. A ce moment, une bouffée
de vent apporta plus distinct l’écho sonore du Carnaval du Wild et
ses ardentes résonances. Les quatre bêtes, oubliant l’autorité de
Kazan, ne résistèrent pas davantage à l’appel de l’homme. Baissant
la tête et les oreilles, et s’aplatissant sur le sol, elles filèrent comme
des ombres, dans la direction du bruit.
Le chien-loup hésitait encore. De plus en plus, il pressait Louve
Grise, tapie sous un buisson, de consentir à le suivre. Elle ne
broncha pas. Elle aurait, aux côtés de son compagnon, affronté
même le feu. Mais point l’homme.
La louve aveugle entendit sur les feuilles séchées un bruit rapide
de pattes qui s’éloignaient. L’instant d’après, elle savait que Kazan
était parti. Alors seulement, elle sortit de son buisson et se mit à
pleurnicher tout haut.
Kazan entendit sa plainte, mais ne se retourna pas. L’autre appel
était le plus fort. Les quatre huskies avaient sur lui une assez forte
avance et il tentait, en une course folle, de les rattraper.
Puis il se calma un peu, prit le trot et bientôt s’arrêta. A moins
d’un mille devant lui, il pouvait voir les flammes des grands feux qui
empourpraient les ténèbres et se reflétaient dans le ciel. Il regarda
derrière lui, comme s’il espérait que Louve Grise allait apparaître.
Après avoir attendu quelques minutes, il se remit en route.
Il ne tarda pas à rencontrer une piste nettement tracée. C’était
celle où l’un des quatre caribous, qui étaient en train de rôtir, avait
été traîné, quelques jours auparavant. Il la suivit et gagna les arbres
qui bordaient la vaste clairière où s’élevait la Factorerie.
La lueur des flammes était maintenant dans ses yeux. Devant lui,
la Grande Ronde se déroulait échevelée.
On aurait pu se croire dans une maison de fous. Le vacarme était
réellement satanique. Le chant en basse-taille des hommes, la voix
plus perçante des femmes et des enfants, les trépignements et les
éclats de rire de tous, le tout accompagné par les aboiements
déchaînés d’une centaine de chiens. Kazan en avait les oreilles
abasourdies. Mais il brûlait d’envie de se joindre au démoniaque
concert. Caché dans l’ombre d’un sapin, il refrénait encore son élan,
les narines dilatées vers le merveilleux arome des caribous qui
achevaient de rôtir. L’instinct de prudence du loup, que lui avait
inculqué Louve Grise, livrait en lui un dernier combat.
Tout à coup la ronde s’arrêta, le chant se tut. Les hommes, à
l’aide de longs pieux, décrochèrent des broches qui les portaient les
énormes corps des caribous, qu’ils déposèrent, tout ruisselants de
graisse, sur le sol.
Ce fut alors une ruée générale et joyeuse de tous les convives,
qui avaient mis au clair leurs coutelas ou leurs couteaux. Et, derrière
ce cercle, suivit celui des chiens, en une masse jappante et
grognante. Kazan, cette fois, n’y tint plus. Abandonnant son sapin, il
se précipita dans la clairière.
Comme il arrivait, rapide comme l’éclair, une douzaine d’hommes
de l’agent de la Factorerie, armés de longs fouets, avaient
commencé à faire reculer les bêtes. La lanière d’un des fouets
s’abattit, redoutable et coupante, sur l’épaule d’un chien d’Esquimau,
près duquel Kazan se trouvait justement. L’animal, furieux, lança un
coup de gueule vers le fouet, et ce fut Kazan que ses crocs
mordirent au croupion. Kazan rendit le coup et, en une seconde, les
mâchoires des deux chiens béaient l’une vers l’autre. La seconde
d’après, le chien Esquimau était par terre, avec Kazan qui le tenait à
la gorge.
Les hommes se précipitèrent, pestant et jurant. Leurs fouets
claquèrent, et s’abattirent comme des couteaux. Kazan, qui était sur
son adversaire, sentit la douleur cuisante. Alors remonta soudain en
lui le souvenir cruel des jours passés, qui avaient fait de l’homme
son tyran. Il gronda et, lentement, desserra son emprise.
Comme il relevait la tête, il vit un autre homme qui surgissait de
la mêlée — car, animés par l’exemple, tous les autres chiens
s’étaient rués les uns contre les autres — et cet homme tenait à la
main un gourdin !
Le gourdin s’abattit sur son dos et la force du coup l’envoya
s’aplatir sur le sol. Puis le gourdin se leva à nouveau. Derrière
l’énorme bâton était une face rude et féroce, éclairée par les reflets
rouges des feux. C’était une telle face qui avait jadis poussé Kazan
vers le Wild. Comme le gourdin s’abaissait, il fit un écart brusque
pour l’éviter, et les couteaux d’ivoire de ses dents brillèrent.
Pour la troisième fois, le gourdin se leva. Kazan, bondissant,
happa l’avant-bras de l’homme qui le portait et lacéra la chair jusqu’à
la main.
— Tonnerre de Dieu ! hurla l’homme.
Et Kazan perçut dans la nuit la lueur d’un canon de fusil.
Mais il détalait déjà vers la forêt. Un coup de feu retentit. Quelque
chose qui ressemblait à un charbon rouge frôla le flanc du fuyard.
Lorsqu’il fut assez loin pour être certain de n’être point poursuivi,
le chien-loup s’arrêta de courir et lécha le sillon brûlant que la balle
avait tracé, roussissant le poil et emportant un lambeau de peau.
Il retrouva Louve Grise qui l’attendait toujours à la même place.
Toute joyeuse, elle bondit à sa rencontre. Une fois de plus, l’homme
lui avait renvoyé son compagnon.
XIX
UN FILS DE KAZAN